During the first Global Crowdfunding Expo, which took place in San Diego, California, last week, some interesting data on the sector were presented. We have written out a few highlights from those data, which might be useful in complementing the information included in the Global Crowdfunding Market Report that will be published shortly by Crowd Valley.
Last month, I was invited to be part of a panel hosted by the Chartered Financial Analyst UK Society and co-organized with CFA UK Private Equity Special Interest Group. The event focused on securities crowdfunding and its evolution in the UK and in the USA, both from a legal and a business perspective. I was joined by several well-known founding members of the UK Crowdfunding Association. The SEC has released a set of proposed rules for implementation of Title III of the JOBS Act, FINRA has released proposed forms and rules for the required registration by funding portals and new rules on general solicitation and general advertising have been put into effect. But where does that leave the market now? Despite the proposals, the Title III crowdfunding market is not open and won’t be for another few months. Furthermore, questions remain as to how navigable that market will be for newcomers and how profitable it will be in the short to medium term. Considering the U.S. has 52 sets of securities laws (federal + the 50 states + D.C), it is no wonder that thousands of lawyers across the country have made comfortable (if paper heavy and, let’s be honest with ourselves, fairly mind-numbing) lives off of this portion of the legal world. U.S. federal and state securities laws are extraordinarily complicated. The web is full of pages that tell you how to run a successful crowdfunding campaign, but there is almost no one giving suggestions on how to launch and run a successful crowdfunding platform. Whilst we do not have the secret recipe to guarantee the success of your platform, we are able to reflect on what has worked best, having helped to successfully launch platforms on five continents. We are not reinventing the wheel - just applying some good suggestions to the case of a crowdfunding platform ready to lunch. As Crowd Valley celebrates its first year of independent operations, it is time to do something special. With securities regulation on marketing offerings changing and public solicitation becoming effective September 23rd and a new market emerging around the world. Crowd Valley will be releasing an industry report in conjunction with Grow Advisors on data points from the global market, planned applications of crowdfunding, segments, geographic breakdown and other relevant topics. This report will be distributed only to those pre-subscribed. The SEC adopts changes to the rules governing the marketing of sales of securities to sophisticated investors Pursuant to the mandate set out in the Jumpstart Our Business Startups Act, the U.S. Securities and Exchange Commission (the SEC) has adopted amendments to Rule 506 of Regulation D and Rule 144A, each under the Securities Act of 1933, as amended (the Securities Act). These changes essentially lift the ban on publicly advertising offers of securities and may fundamentally change the way in which small and medium sized companies raise capital. “Innovation doesn’t happen in a vacuum. You’re never alone. No one has the key just by himself.” Rogier van der Heide Equity crowdfunding originated in the start-up sector and has successfully proven the innovative power of leveraging an investment ecosystem. It enables investors and other stakeholders to collaboratively contribute to the due diligence process, untap the wisdom of the crowd, verify the credibility of entrepreneurs and provide them with feedback on business ideas and business model assumptions. Crowdfunding gives entrepreneurs access to reputable experts and talents, utilising their expertise and man-power. Furthermore crowdfunding gives entrepreneurs a great tool for receiving market feedback and validation of product features as well as opportunities to build relationships with potential new customers. “A low-carbon, clean energy economy can be an engine of growth for decades to come” – President Barack Obama, June 25, 2013 On Tuesday US president Obama announced a comprehensive climate action plan, calling amongst others, for a doubling of renewable energy in the U.S. by 2020. A critical success factor in achieving this goal will be the participation of communities in the ownership and development of clean energy solutions such as renewable energy projects. “In one way or another, power to the people is just beginning. Say hello to the democratization of energy.” Ernst &Young, Renewable Energy Country attractiveness index, May 2013 The industrial revolution originated a centralized model of electricity generation and distribution. Worldwide 93% of all electricity is still supplied this way and every year billions of tons (in oil equivalent) of fossil fuels such as oil, gas and coal are burned in large thermal power stations, transmitting the generated energy via the power grid to the consumers. It is a very inefficient system as it wastes two thirds of the primary energy input; as a result, the electricity and heat sector currently accounts for 41% of the worldwide greenhouse gas emissions. This is a large contributing factor to climate change, whose adverse effects are becoming more and more evident. In addition, 1.2 billion people around the world still are living in energy poverty, having no access to electricity at all. |
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